ATCHISON  & NEBRASKA 

RAILROAD  COMPANY. 


LETTER 


FROM  THE  PRESIDENT  TO  THE  DIRECTORS 


JANUARY  1st,  1872. 


BOSTON: 

Printed  by  T.  W.  Ripley  & Co.,  56  Congress  Street. 


RAILROAD  COMPANY, 


LETTER 

FROM  THE  PRESIDENT  TO  THE  DIRECTORS 


JANUARY  1st,  1872. 


BOSTON: 

Printed  by  T.  W.  Ripley  & Co.,  56  Congress  Street. 


OFFICERS 


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Ifyfoott  | }\dmto()a  Hjailroail  Co; 


P.  T.  Abell,  President , . . . Atchison,  Kansas. 


James  F.  Joy, Detroit. 

N.  Thayer, Boston. 


H.  H.  Hunnewell,  . 
William  F.  Weld,  . 
John  A.  Burnham,  . 
James  H.  Beal,  . . 

Henry  A.  Whitney, 
Charles  L.  Young,  . 
George  Putnam,  Jr. 


John  A.  Stewart, New  York. 

G.  W.  Glick, Atchison. 


George  L.  Pratt,  Boston. 

^upmntentlent  and  (fDJnef  nm, 

F.  R.  Firth,  Atchison. 


Atchison,  Kansas,  January  1st,  1872. 


To  the  Board  of  Directors  of  the 

Atchison  $ Nebraska  Railroad  Company , 

Boston , Mass. 

Gentlemen  : — 

1 herewith  submit,  for  your  consideration,  a state- 
ment of  the  condition  of  the  Road, — its  prospects, — cost  to 
Tecumseh,  and  estimated  cost  to  Lincoln, — with  earnings 
during  construction,  and  estimated  earnings  from  the 
present  time  until  July,  1873,  one  year  after  the  supposed 
time  of  completion  to  Lincoln. 

I have  fully  completed  to  Table  Rock,  eighty-five  miles 
from  Atchison,  and  am  now  operating  to  that  point,  and 
but  for  the  unprecedented  bad  weather,  I should  have 
completed,  and  been  operating  to  Tecumseh,  one  hundred 
and  three  miles.  Though  I have  the  grading  nearly  all 
done  to  that  point,  and  the  iron  and  other  materials 
on  the  ground,  yet  it  would  not  only  be  very  expensive  to 
attempt  to  work  at  construction  such  weather  as  we 
have  had  for  the  past  month,  but,  if  we  could  lay  the  iron, 
it  would  be  very  unsafe  and  injurious  to  attempt  to  run 
trains  over  it  until  the  road-bed  thaws  and  dries.  Under 
these  circumstances  I suspended  work,  intending  however 
to  resume  whenever  the  weather  would  permit. 

From  my  own  knowledge  and  the  books  in  our  office  at 
Atchison,  and  the  accompanying  documents,  maps,  statis- 
tics and  estimates  Nos.  1,  2,  3 and  4,  prepared  by  myself, 
our  chief  engineer,  and  cashier,  I am  enabled  to  make  the 
following  calculations  and  remarks  in  regard  to  the  road 
and  its  prospects. 


f 45025 


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In  round  numbers,  the  whole  cost  of  the  road,  depots, 
real  estate  and  full  equipment  from  Atchison  to  Te- 
cumseh,  one  hundred  and  three  miles,  is 

(See  No.  4), 12,050,000.00 

including  operating  expenses  to  Nov.,  18T1 ; 
but  of  this  amount  the  Counties  paid,  viz. : — 

Atchison  County,  ....  $150,000 

Doniphan  “ > 200,000 

Richardson,  Nebraska,  ...  67,800 

— — - 417,800.00 


$1,682,200.00 

From  this  amount  deduct  earnings 
to  Nov.,  1871,  which  helped  to 

pay  above  (see  No.  3), 62,862.00 

Net  cost  at  Tecumseh,  paid  and  to  be  paid  for 

everything, $1,569,338.00 

Add  to  this,  cost  from  Tecumseh  to  Lincoln 

(see  report  No.  1), 811,000.00 

Net  cost  at  Lincoln,  including  full  equipment 

July,  1872,  145  miles, $2,380,338.00 

From  this  deduct  earnings  from  Nov.,  1871, 

to  July,  1872  (see  report  No.  2),  . . . 62,200.00 


$2,318,138.00 

Say,  when  we  reach  Lincoln,  we  owe  one 
year’s  interest,  to  July,  1872,  at  8 per  cent, 
on  whole  cost, 185,451.00 


Total  cost  at  Lincoln,  with  one  year’s  interest 

added, $2,503,589.00 

To  pay  this,  suppose  we  issue  three  million 
and  a half  dollars  First  Mortgage  Bonds, 
which  is  less  than  $25,000  per  mile  (whole 
length  145  miles),  and  sell  the  Bonds  at  80 


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cents, — three  and  a half  millions  of  Bonds 

will  yield,  at  80  cents, $2,800,000.00 

Total  cost  at  Lincoln,  with  one  year’s  interest 
added,  July,  1872, 2,503,589.00 


Surplus,  July,  1872,  for  a fund  for  con- 
tingencies,   $296,411.00 

The  interest  on  three  and  a half  million  of 

Bonds,  to  July,  1873,  at  8 per  cent.,  is  . $280,000.00 

which  has  to  be  provided  for,  July,  1873. 

So  far,  I have  been  enabled  to  make  the  cost  consider- 
ably below  the  original  estimates  of  our  engineer,  and  I 
feel  confident  that  the  estimates  from  Tecumseh  to  Lincoln 
can  be  reduced  nearly  one  hundred  thousand  dollars. 

When  we  reach  Tecumseh,  we  shall  have  in  County 


Bonds,  viz. : — 

Balance  of  Richardson  County, $50,000.00 

Table  Rock  Precinct, 20,000.00 

Johnson  County,  80,000.00 

At  Lincoln  we  will  have  balance  of  Johnson 

County, 22,000.00 

Lancaster  County,  (Lincoln), 120,000.00 


$292,000.00 

These  bonds  all  bear  ten  per  cent,  interest, 
except  Richardson  County,  which  bear  eight 
per  cent.  July,  1873,  the  interest  on  these 
County  Bonds  (and  it  will  be  promptly 
paid)  will  amount  to  at  least  ....  $35,500.00 

The  net  earnings  from  July,  1872,  to  July, 

1873,  one  year  after  reaching  Lincoln,  and 
and  when  the  interest  on  the  whole  Bonds 
is  due,  will  be  (see  report  No.  2),  . . . $222,500.00 


$258,000.00 


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Thus  it  will  be  seen  that  the  earnings  and  interest  on 
County  Bonds,  will  only  lack  $22,000  of  paying  the  whole 
amount  of  interest  on  the  three  and  a half  millions  of  Bonds, 
to  say  nothing  of  the  surplus  arising  from  sale  of  Bonds  of 
$296,411.00.  Then,  too,  we  have  secured  20,000  acres  of 
land  in  Nebraska,  and  have  in  dispute,  and  in  suit,  40,000 
acres,  which  I feel  confident  we  will  gain. 

I am  well  satisfied  that  the  three  and  a half  millions  of 
Bonds  can  be  issued  with  perfect  safety,  and  the  interest 
will  be  paid  July,  1873,  from  the  earnings  of  the  road, 
without  interfering  with  any  other  fund,  provided  I am 
permitted  to  push  on  to  Lincoln  as  speedily  as  possible, 
without  a useless  expenditure  of  money.  If  all  things 
work  as  smoothly  as  heretofore  — and  I have  no  reason  to 
doubt  it  — the  calculations  I have  made  will  be  more  than 
realized.  Our  business  to  Table  Rock  is  increasing  beyond 
our  estimates,  and  the  farther  we  go  the  greater  will  be  the 
increase  in  proportion. 

Fearing  I might  have  made  some  errors,  this  report  was 
submitted  to  Mr.  James  F.  Joy,  before  delivering  it  to  you, 
and  he  endorses  and  approves  it.  By  reference  to  the  accom- 
panying statistics,  estimates,  etc.,  it  will  easily  be  seen 
that  these  calculations  are  not  guess-work,  but  are  founded 
on  what  we  have  done,  and  are  now  doing,  and  the  statis- 
tics of  the  country  through  which  our  road  runs. 

The  country  on  the  entire  line  of  our  road  is  unsur- 
passed by  any  in  the  West.  Now  that  we  have  demon- 
strated that  the  road  will  be  speedily  built,  the  country  is 
beginning  to  improve,  our  advertisements  are  already 
attracting  emigrants  to  look  at  it,  and  we  anticipate  a 
large  emigration  another  season.  If  our  hopes  in  this 


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respect  are  half-realized,  our  earnings  are  largely  under- 
estimated. But  should  there  he  but  little  emigration,  the 
present  population,  stimulated  and  encouraged  by  the  rail- 
road, will  so  increase  the  cultivated  lands,  that  our  esti- 
mates will  be  fully  sustained.  Our  estimates  are  based 
upon  the  present  population  and  valuation  of  property, 
and  the  ratio  of  increase  for  the  last  five  years,  without  any 
railroad. 

We  should,  by  all  means,  reach  Lincoln  at  the  earliest 
day  possible,  for  then,  in  addition  to  our  local  business, 
we  will  form  a connection  with  the  Burlington  and  Mis- 
souri Biver  Railroad,  and  secure  more  or  less  through- 
business  west  to  California,  to  Omaha,  and  south  to  St. 
Louis.  It  must  be  recollected  that  Lincoln  is  already  a 
city  of  five  thousand  people,  and  rapidly  growing  ; that  it 
is  the  Capital  of  Nebraska,  and  the  travel  naturally  inclines 
to  go  to  and  through  it.  Then,  too,  our  road  will  be  the 
only  outlet  for  Lincoln  south,  and  the  only  connection 
between  Southern  Nebraska,  Lincoln  and  Omaha.  On 
the  line  of  our  road,  throughout  the  Nemaha  Valley,  there 
is  excellent  building-stone,  and  good  water-power,  and  the 
absence  of  timber  for  building,  fencing,  fuel,  etc.,  insures, 
to  the  road  an  increasing  business  in  the  transportation  of 
stone,  native  lumber,  pine  and  coal. 

Farmers  along  the  line  are  already  largely  engaged  in 
raising  hogs,  and,  as  these  cannot  be  driven  to  market,  the 
road  is  now  doing,  and  will  do,  a good  stock-business  in 
the  fall  and  winter;  not  to  mention  the  probable  importa- 
tion of  southern  cattle  to  fatten  on  the  broad  grazing 
bottoms  of  the  Nemaha. 

The  magnesian  limestone  which  abounds  on  our  line 
will  be  required  for  public  works,  and  other  improvements, 


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and  afford  another  sure  source  of  income  to  the  road. 
Already  we  have  applications  for  side-tracks  to  quarries. 

Our  road  is  the  only  outlet  for  Southern  Nebraska  to 
St.  Louis  — or  in  any  direction ; — and  the  St.  Louis  mar- 
ket is  becoming  the  commanding  one  in  the  West,  for  all 
farm  products,  except  cattle,  and  they  too  must  go  over 
our  road  to  Chicago,  and  the  North  and  East. 

I will  add,  that  our  connection  with  the  Burlington 

© 

and  Missouri  Hoad  at  Lincoln  gives  us  a route  to  California 
from  St.  Louis  and  Kansas  City,  eighty  miles  shorter  than 
via  Denver,  and  one  hundred  and  ten  miles  shorter  than 
via  Omaha. 

I hope  I shall  not  be  considered  egotistical  or  extrava- 
gant in  saying,  that  ours  is  one  of  the  best  built  roads  in 
the  country,  and  that  our  depots  and  equipment  are 
superior  to  those  of  any  road  in  Nebraska  or  Northern 
Kansas.  The  people  along  our  entire  line  are  our  friends, 
and  in  place  of  throwing  obstacles  in  our  way,  as  is  fre- 
quently the  case,  they  are  doing  all  in  their  power  to  facil- 
itate the  construction  of  the  road,  and  to  build  up  its  busi- 
ness. With  such  aid,  and  economy  in  the  construction  and 
operation  of  the  road,  I have  been  enabled  all  the  time  to 
make  our  expenses  less  than  the  original  estimates  of  our 
engineer,  and  I am  satisfied  I can  continue  to  do  so,  I do 
not  now  remember  anything  more  important  for  me  to  say 
to  you,  but  hope  that  what  I have  said,  and  the  accompanying 
maps,  statistics,  etc.,  will,  to  some  extent  at  least,  inform 
and  satisfy  those  interested.  All  of  which  is  respectfully 
submitted. 

P.  T.  ABELL, 

President 

Atchison  and  Nebraska  Railroad  Company. 


